Some Microsoft temporary workers may see pay cuts

Microsoft Corp. is cutting the rates it pays its temporary staffing agencies by 10 percent, the Seattle P-I has learned.

As part of a plan to cut spending on contingent staff by up to 15 percent, Microsoft notified all of its temporary staffing agencies last week that it was reducing its bill rates by 10 percent.

At least one agency, Aditi Staffing, is passing the cuts on to employees, who will make less per hour effective Saturday.

“As a result of this mandatory change by Microsoft, it has unfortunately become necessary for us to make salary adjustments for all workers on assignment at Microsoft,” according to an Aditi Staffing memo to employees this week, which the P-I obtained.

A list of frequently asked questions attached to the memo advises affected employees not to discuss the change with their Microsoft managers. It also warns employees not to resign from their current assignments in order to seek new ones at the company.

“For any new assignments, Microsoft is mandating larger reductions in rates than those being put into place for existing workers,” the memo states. In addition, if a worker voluntarily quits work with Aditi, he or she won’t be eligible to start a new assignment at Microsoft through Aditi or any other agency for 30 days.

Microsoft Spokesman Lou Gellos confirmed that the company had notified its temporary staffing agencies of a 10 percent reduction in its bill rates last week.

He said that executives from the agencies as well as from Microsoft had held a teleconference to discuss possible ways to cut costs. The cut in the bill rates was the result.

On Jan. 22, Microsoft announced a companywide cost-cutting initiative in response to the deteriorating economy.

In addition to cutting up to 5,000 jobs at the company over the next 18 months, the company said it would also make “significant reductions in spending on vendors and contingent staff.”

Microsoft has never disclosed how many contractors it employs, although Sid Parakh, an analyst at McAdams Wright Ragen, estimates there are roughly 40,000 Microsoft contractors.

However, the cuts in the bill rates will affect only the subclass of contractors who must take 100 days off after working a maximum of one year at Microsoft. After 100 days off, those contractors can restart their work.